The nuances of advertising expenses in taxation
Posted: Sun Jan 19, 2025 4:59 am
Some marketing expenses do not reduce the tax base
When a company spends money to promote its dealers, it cannot account for such expenses because it is advertising for the benefit of third parties.
Expenses for standardized types of promotion cannot be included in the taxable base if they exceed 1% of sales revenue.
The Tax Code clearly defines the list of non-standardized advertising expenses. Promotion costs not reflected in it are taken into account as non-standardized. In this regard, some problems arise. Let's assume that product samples were presented not only at the exhibition, but also demonstrated at a professional forum. Can such expenses be classified as non-standardized?
Such nuances require physician data package separate interpretation and adoption of additional explanatory documents. For example, the Ministry of Finance has expanded the list of printed advertising materials, the production costs of which are non-standardized. In addition to catalogs and brochures, this list includes booklets, leaflets, flyers, leaflets.
Offline advertising
Source: shutterstock.com
Outdoor advertising costs are recognized as non-standardized, however, tax legislation does not mention promotion on public transport. Therefore, when placing information about goods and services in the metro, an entrepreneur must take such costs into account as standardized.
Determination of the maximum amount of standardized advertising expenses
It is calculated as 1% of all receipts for sold goods, rendered services, transferred property rights excluding excise taxes and VAT.
If advertising expenses exceed the standard in one of the reporting periods, they can be taken into account in the following ones if revenue increases. This is possible because income tax is calculated cumulatively throughout the year.
Tax authorities recommend accounting for promotion costs separately within each advertising campaign. This will help avoid exceeding the limit for standardized expenses, because some purchases can be made under other items.
Let's assume that souvenirs were ordered and premises were rented to hold a promotion. Rental costs may not be considered advertising. Part of the souvenirs that are suitable for use in the business life of the company's employees (calendars, pens, diaries) fall under the expense item "Stationery" and are also not included in promotional expenses if desired (subparagraph 24 of paragraph 1 of Article 264 of the Tax Code of the Russian Federation).
When a company spends money to promote its dealers, it cannot account for such expenses because it is advertising for the benefit of third parties.
Expenses for standardized types of promotion cannot be included in the taxable base if they exceed 1% of sales revenue.
The Tax Code clearly defines the list of non-standardized advertising expenses. Promotion costs not reflected in it are taken into account as non-standardized. In this regard, some problems arise. Let's assume that product samples were presented not only at the exhibition, but also demonstrated at a professional forum. Can such expenses be classified as non-standardized?
Such nuances require physician data package separate interpretation and adoption of additional explanatory documents. For example, the Ministry of Finance has expanded the list of printed advertising materials, the production costs of which are non-standardized. In addition to catalogs and brochures, this list includes booklets, leaflets, flyers, leaflets.
Offline advertising
Source: shutterstock.com
Outdoor advertising costs are recognized as non-standardized, however, tax legislation does not mention promotion on public transport. Therefore, when placing information about goods and services in the metro, an entrepreneur must take such costs into account as standardized.
Determination of the maximum amount of standardized advertising expenses
It is calculated as 1% of all receipts for sold goods, rendered services, transferred property rights excluding excise taxes and VAT.
If advertising expenses exceed the standard in one of the reporting periods, they can be taken into account in the following ones if revenue increases. This is possible because income tax is calculated cumulatively throughout the year.
Tax authorities recommend accounting for promotion costs separately within each advertising campaign. This will help avoid exceeding the limit for standardized expenses, because some purchases can be made under other items.
Let's assume that souvenirs were ordered and premises were rented to hold a promotion. Rental costs may not be considered advertising. Part of the souvenirs that are suitable for use in the business life of the company's employees (calendars, pens, diaries) fall under the expense item "Stationery" and are also not included in promotional expenses if desired (subparagraph 24 of paragraph 1 of Article 264 of the Tax Code of the Russian Federation).